The Mission Viejo housing market has suffered in recent months despite an uptick in the median price of a Mission Viejo home for sale. The number of home sales in the region have decreased substantially over the last tracking period, a trend reflected in the larger California real estate market. According to an August 24, 2010 piece from the OC Metro, "Meanwhile, Orange County sales plummeted 12.6 in July, compared to the same time last year. They also fell 14.5 percent from June. The downward trend was seen across the state, which reported a 20.8 percent drop in home sales from July 2009. Sales also slipped 10.9 percent from June...For the remainder of the year, slower sales could negatively impact the median home price, added C.A.R. Vice President and Chief Economist Leslie Appleton-Young...In a separate report conducted by C.A.R. and DataQuick, which uses county records data for its stats, Orange County's median home price saw a 6.9 percent gain in July, compared to the same month in 2009. The number rose to $449,000. Additionally, Newport Beach ranked among the top 10 priciest cities in the state, with a median cost of $1.1 million. Lake Forest landed among the top 10 cities with the greatest median price increases, compared to a year ago. The region saw a 24.3 percent uptick."

The entirety of Southern California saw a drop in home sales, mirroring the decline of the Mission Viejo real estate market. According to an August 17, 2010 report from the Associated Press, "Home sales in Southern California plummeted 21.4 percent last month for the largest year-over-year drop in more than two years, a tracking firm reported Tuesday, suggesting the market isn't ready to stand on its own without the help of federal tax credits. San Diego-based MDA DataQuick said the six-county region saw 18,946 sales last month, compared with 24,104 in July 2009. Sales fell 20.6 percent from 23,871 in June, the firm said. DataQuick said last month was the slowest July since 2007, when 17,867 homes were sold. July's year-over-year decline also was the steepest drop since March 2008, when the newly frozen credit market prompted a sales decline of 41.4 percent...The median home price in Southern California declined 1.7 percent to $295,000 last month from $300,000 in June, its second consecutive month-to-month decline."

The Laguna Niguel housing market, found in the midst of Orange County, Southern California, saw a serious decline in the number of homes sold over the last tracking period. Not all the news was negative, however, as the median price of a Laguna Niguel home for sale rallied substantially over the year ending June 30. According to an August 25, 2010 report from the Orange County Register, "In the midst of a week filled gloomy housing news, a glimmer of sunshine has broken through. Sure, Orange County house sales may be down for the first time in two years and new home sales contracts may be down 35%. But things are looking up in O.C.’s housing market, if you believe the Federal Housing Finance Administration – the agency that oversees Fannie and Freddie. According to FHFA, Orange County’s home-price appreciation was fourth highest among 303 of the nation’s metro areas this past spring. That’s right, we’re Number 4 according to the federal government’s House Price Index, which dates back 35 years. Based on FHFA math — which compares repeat transactions involving Fannie and Freddie loans for home purchases and refinancing — O.C. home prices increased 1.45% in the 12 months ending on June 30. Of course, that’s old data, preceding the end of federal tax credits and the damper their demise put on billowing home sales. And it gives you a sense of how bad things must be in the rest of the country. After all, Orange County was able to elbow it’s way up to Number 4 in the nation with an appreciation rate of just 1.45%." 

In the vast majority of Orange, County, the number of home sales decreased, although a few areas did post modest gains. An August 26, 2010 article also from the Orange County Register found that "Taking sales volume into consideration, home sales are down in 68% of the market. Overall, countywide sales were down15.1% from a year ago...Thirteen local ZIPs had both sales gains and price gains in the period. These double-gainers had combined sales volume equal to 19% of the Orange County market. But 27 local ZIPs had double losses — with both sales and price down. They had a combined sales volume equal to 28% of the market."

The Buena Park real estate market, found in Orange County, California, saw some unfortunate economic news in the month of July. The number of Buena Park homes for sale which were purchased by investors or residents decreased almost twenty percent over that period, while the second quarter of the year saw a large proportion of distressed homeowners. According to an August 17, 2010 article from the OC Metro, "Home sales in Orange County fell by the largest amount in more than two years in July as federal tax credits for buyers ran out, but the median price for a residence in the region rose over the same time last year, according to stats released by San Diego-based MDA DataQuick. Home sales declined 19.2 percent to 2,527 in July, down from 3,128 at the same time last year. The number also dropped from 3,423 in June, when sales hit their highest level in the month since 2006...Meanwhile, Orange County's median home price jumped 7.1 percent in July over the same period in 2009, marking the 11th straight month of yearly gains. The number hit $450,000, up from $420,000 a year earlier. The median also rose slightly from $445,000 in June. For the entire Southern California region, the median home price increased 10.1 percent in July to $295,000, up from $268,000 in 2009. However, the number dropped from June."

The number of distressed homeowners in Orange County, including Buena Park, actually fell from year-ago levels, although that was likely the result of more foreclosed properties. According to an August 26, 2010 article from the Orange County Register, "Fewer Orange County homeowners were under water last spring than in the winter, according to CoreLogic, a Santa Ana real estate data firm. But that decline was due mainly to distressed homeowners losing their homes to foreclosure than to rising home values. CoreLogic reported: More than 102,000 Orange County mortgages — 18.1% — were under water during the second quarter of the year, meaning that the owners owed more than their homes were worth — also known as having “negative equity” or being upside-down. That’s down from 19.2% during the first quarter, CoreLogic reported. An additional 4.1% of homeowners with mortgages were on the verge of going under water, with less than 5% equity in their homes."

The Irvine real estate market has been experiencing a substantial drop-off following the expiration of the federal housing tax credit. However, the Orange County economy does not appear to be headed for a double-dip recession, boosting hopes that the Irvine housing market will soon return to positive territory. According to an August 24, 2010 article from the Orange County Register, "Homebuyers signed just 99 contracts to buy a new Orange County home in June, the lowest number since the Thanksgiving-Christmas holiday slowdown last fall, according to Costa Mesa-based Hanley Wood Market Intelligence. That’s down 35% from the number of new home sales contracts signed in June 2009 and down a third from May’s new-homebuying activity. A 92% drop in condo sales is a chief factor in the decline. But the weak economy and the end of federal tax credits likely played a roll, too. For example, sales at builders’ tracts were down across all housing types in June: Single-family homes: 62 sales contracts signed, down 12.7% from June 2009’s total of 71 and down 33.3% from May’s 93 units. Condos: Just three new condos went into escrow in June, a 92% decline from the previous year’s tally of 37 units. In May, buyers signed 28 condo contracts. Townhomes: 34, down 22.7% from June 2009’s total of 44, but up 30.8% from May’s 26 units. All new homes: 99, vs. 152 in June 2009 and 147 in May. Prices: Median prices were up for all housing types from year-ago prices. However, the median price of newly built homes fell 12.2% from May’s levels, drawn down by a decline in new house prices."

Despite these negative numbers, it is possible that more investors will be interested in Irvine homes for sale if the economy continues to grow. An August 26, 2010 report also from the Orange County Register noted that "After a spurt earlier in the year, Orange County's economic recovery is slowing but it is unlikely to fall into a double-dip recession, Wells Fargo Bank's senior economist said today. Will helping business boost jobs? Scott A. Anderson told a Wells Fargo breakfast group in Irvine that he expects local employment to decline 0.2% this year — not good but better than the -7.4% in 2009. Next year, however, he predicts hiring in Orange County will grow at a 1.6% pace, outperforming the state, which will see 1.1% job growth."

The Dana Point housing market, found in Orange County, California, saw a decrease in the number of foreclosures but an increase in the number of defaults during July 2010, continuing a pattern that has made the region one of the riskiest real estate markets in the country. According to an August 17, 2010 report from the Orange County Register, "Lenders seized fewer homes in July for a third straight month, repossessing nearly 10% fewer homes than in June. Meanwhile, default notices filed against homeowners who have missed three or more house payments increased 9% last month from June’s levels. Both numbers, however, were down significantly from a year ago, apparently as lenders either seek alternative means to deal with unpaid mortgages or postpone their losses. According to MDA DataQuick: Lenders seized 629 Orange County homes in July. While that would have seemed like an unusually high number during the slump of the mid-1990s (which peaked at just under 700 foreclosures in one month), it actually was down 22% from the total number of families losing their homes in July 2009. Since the housing slump began in the fall of 2005, O.C. foreclosures have gotten almost as high as 1,450 in one month...Meanwhile, default notices – which peaked at 3,500 in the winter of 2009 – totaled 1,462 in July. That’s down 51% from a year ago."

Dana Point homes for sale remain some of the most dangerous investments in the nation's housing market, according to a second report from the Orange County Register. This piece, composed by Jeff Collins on August 24, 2010, states that "or the second quarter in a row, Orange County’s risk of a price decline within a two-year period ranked ninth in the nation — just behind eight other metro areas that were tied for first, according to economists at mortgage insurer PMI Group. The latest housing risk assessment from PMI, based largely on first quarter stats, shows …Orange County home prices have 99.7% chance of price loss in two years, or by the winter of 2012. PMI Group doesn’t say how big of a price drop that would be, so the declines could be small or large. That’s a slight improvement over the previous two quarters. In the final quarter of 2009, the probability was 99.8%."

The number of Costa Mesa homes for sale which are actually being purchased has declined substantially in the most recent tracking period, even as authorities report a higher proportion of fraudulent ‘short sales’ on distressed properties. According to an August 17, 2010 article from the Orange County Register, “Southern California home sellers experienced the biggest annual drop in sales last month in more than two years, due chiefly to the virtual ending of federal tax credits a month earlier, MDA DataQuick reported today. DataQuick reported that 18,946 housing transactions closed in July. That’s down about 20% both from June and from July 2009. It was the steepest year-over-year decline in SoCal sales since March 2008. The median home price, meanwhile, dipped from June but was up 10% from a year ago. In addition, DataQuick reported…Last month’s sales decline was three times greater than the typical June-to-July drop (6.7%). Last month’s sales total was 27.4% below the July average dating back to 1988. Last month was the slowest July since 2007 and the second-slowest since July 1995. Sales fell in all six counties in the region, ranging from a 10.5% drop in Ventura County to a 28% drop in San Bernardino County. The median home price, or price at the midpoint of all sales, was up in every county but Ventura.”

Nearly two in every hundred short sales are fraudulent, according to a second article from the Orange County Register. This means that an increased proportion of Costa Mesa homes for sale are the product of predatory lending and other practices. The report by Jeff Collins stated that “Short sales are tough enough these days without this latest bit of news. Just this week, Altera Real Estate’s Steve Thomas reported that the backlog of Orange County short sales is dizzying. About half of O.C. short sales — or sales in which a home is sold for less than is owed on the mortgage — take two months or more to get a lender’s approval, Thomas reported. Now comes a report from Santa Ana-based CoreLogic concluding that lenders have one other thing to be cautious about: Short sale fraud. The study concluded that: 1.9% of all U.S. short sales over the past two years — roughly 15,000 nationwide — are fraudulent. That’s one out of every 53 deals.”

The Alison Viejo housing market, found in the midst of the larger Orange County real estate market, saw some slight signs of improvement despite largely negative news in the area. The number of defaulted mortgages increased in the most recent tracking period despite a fall in foreclosures and a decline in sales revenue. According to an August 17, 2010 report from the Orange County Register, “Lenders seized fewer homes in July for a third straight month, repossessing nearly 10% fewer homes than in June. Meanwhile, default notices filed against homeowners who have missed three or more house payments increased 9% last month from June’s levels. Both numbers, however, were down significantly from a year ago, apparently as lenders either seek alternative means to deal with unpaid mortgages or postpone their losses…Lenders seized 629 Orange County homes in July. While that would have seemed like an unusually high number during the slump of the mid-1990s (which peaked at just under 700 foreclosures in one month), it actually was down 22% from the total number of families losing their homes in July 2009. Since the housing slump began in the fall of 2005, O.C. foreclosures have gotten almost as high as 1,450 in one month. Foreclosures have been relatively stable in O.C. for the past 21 months, ranging from 482 homes seized in April 2009 to 835 in January 2009. The county has averaged 701 foreclosures a month since November 2008.”

The amount of private and tax revenue generated from the sale of Alison Viejo homes for sale faced a dramatic fall recently, possibly as a result of the expiration of the federal housing tax credit. According to an August 19, 2010 article from the Orange County Register, “Sales dollars for Orange County properties fell by about $200 million in July from the two preceding months, the product of an abrupt market slowdown caused by the expiration of federal tax credits. According to the Southern California Multiple Listing Service…Broker managed home sales generated just over $1.3 billion in July. That’s the smallest revenue total for a July in figures dating back to 2005. In the first half of 2010, O.C. sales revenues increased by 18 percent or more from the year before. By comparison, July revenues were down 5.6 percent. July’s sales generated $80 million less than in the same month last year – and about $200 million less than May’s and June’s totals.”